McDonald’s to add jazzed-up oatmeal to its menu
Forget your grandmother’s lumpy, boring oatmeal.
Maple-flavored oatmeal jazzed up with diced red and green apples, a mix of raisins and cranberries and cream will be available at McDonald’s 14,000 restaurants nationwide by the end of this week. The product, served in a small cardboard cup, will cost $1.99.
McDonald’s Corp., which will back its rollout with a massive national advertising blitz starting Jan. 3, is the latest chain to jump on the oatmeal craze. But the move by the Oak Brook, Ill., hamburger chain is expected to trigger a slew of imitators, experts say.
Starbucks Corp. was the first major fast-food chain to market oatmeal in 2008. Its steel-cut, instant variety was made to order at the coffee chain’s restaurants and came with packets of brown sugar, dried fruit and nuts.
Despite the time required to wait for the oatmeal to steep — and the effort in finding a space at the bar for milk and juggling and opening various condiment packets — oatmeal became a hit for Starbucks. Oatmeal also is credited with helping the Seattle company turn around the perception that its food quality didn’t measure up to its coffee.
Within two weeks and without TV advertising, its $2.45 oatmeal became Starbucks’ bestselling food by a significant margin.
Later in 2008, Jamba Juice Co. released its own version, a slow-cooked variety, with brown sugar and fresh fruit or fruit compote. The Emeryville, Calif., juice chain has struggled with its same-store sales, but its oatmeal garnered a raft of glowing reviews.
Since then, fruit and nuts have become de rigueur for oatmeal in any restaurant. Even staid brands like restaurant chain Bob Evans, which has served oatmeal for many years, now offers dried cranberries, raisins and pecans for an extra 50 cents, a total of $2.79 for a cup, or $3.79 for a bowl.
Quaker Oats Co., the Chicago conglomerate that has struggled with its sales amid the oatmeal boom, tried to get in on the action late last summer by updating its single-serving product, adding dried fruit and promising a thicker texture. It’s too soon to say how the product is faring.
The chains see oatmeal as an ideal way to spur breakfast — and possibly snack — sales, thanks partly to its healthful image, but also because of its affordability, a bonus as the recession forced many people to look for lower-cost breakfast food.
For McDonald’s, its oatmeal launch represents another big step in the fast-food breakfast segment it created in the 1970s. Despite increased competition from chains such as Burger King, Subway and even Starbucks, McDonald’s has maintained a commanding lead, with up to 17% of the $60-billion market, according to food industry research firm Technomic. Breakfast accounts for at least 25% of the chain’s U.S. sales.
McDonald’s has been testing oatmeal for more than a year in Washington, where customers at its outlet in Union Station said they were eating oatmeal, in part, for the health benefits.
“I like the nutritional aspect and that it’s really cheap,” Michelle Artson said. The Woodbridge, Va., resident said she makes slow-cook oatmeal and Cream of Wheat at home but had gotten hooked on the McDonald’s variety. “The fruit is a plus, although I kind of wish there were nuts, but I know some people have nut allergies.”
Sangho Moon, a visiting professor at Stanford University, said he stopped at the Union Station McDonald’s to try the oatmeal, despite blaming the chain for his health problems.
Moon said he developed heart disease after eating too many hamburgers and fries in the U.S. while studying for his doctorate in the 1990s. His health improved after he had surgery and made some dietary changes. “I’ve had a lot of anger at McDonald’s,” he said.
Moon said that when he saw oatmeal on the McDonald’s menu, he decided to give it a try.
“They innovated,” he said. “I think the company’s image will be helped by this. People will have the impression that McDonald’s cares about them.”
But don’t look for oatmeal to redefine the breakfast menu at McDonald’s, if the traffic pattern at the Washington restaurant was any indication. On that recent morning, sausage, egg and cheese biscuits appeared to be outselling oatmeal at least 5 to 1.
A McDonald’s spokeswoman said in an e-mail, “Considering oatmeal will be offered all day, we anticipate that it will resonate strongly with customers.” But she said, “It’s too early to speculate on sales.”
Although nutritionists typically categorize the whole-grain food as healthful, the calories in some of the chain’s versions of oatmeal could set a dieter back. McDonald’s oatmeal comes in at less than 300 calories, but Caribou Coffee’s “very berry” oatmeal with raisins, nuts, sugar and berry compote has 470 calories.
“It starts out as a great food, but depending on what’s being added, it could become a high-calorie food very quickly,” said Toby Smithson, a dietitian and spokeswoman for the American Dietetic Assn.
Smithson said that one serving of whole grains is about half a cup, but most fast-food restaurants serve at least twice that. That should be acceptable for most people, “as long as they’re not having something like a bagel with it.”
Darren Tristano, executive vice president at Technomic, said oatmeal enjoys a “health halo” but also appeals to less health-conscious consumers as a hearty breakfast. He said oatmeal, which will be McDonald’s first foray into all-day breakfast options, also might become a popular snack.
“Our reports have indicated that consumers would like to see breakfast-all-day options,” Tristano said. Something like that at McDonald’s, he said, could have “a really big impact” because it’s priced at less than $2, similar to the chain’s snack wraps.
“For late-morning and midafternoon snack, I think it will work,” he said.
Although oatmeal generally has been popular with consumers, experts say, it’s been gaining ground over the last decade. According to NPD Group, a market-research firm, oatmeal consumption has gone from 7.7% of all breakfasts in 2005 to 9.9% in 2010.
A breakfast study by Technomic found that oatmeal falls behind cold cereal, eggs, bacon and toast in popularity, but ahead of sausage and hash browns.
“It’s easy to make, it’s inexpensive, and it’s a comfort food that many Americans have familiarity with,” Tristano said.
“Given the recession and because of the price point, it’s become a nice option for the younger generation, who are bringing oatmeal to work because hot water is plentiful. But if you forget it or if you want a social occasion, getting oatmeal at breakfast is sometimes cheaper than a cup of coffee.”
Harry Balzer, chief food industry analyst of NPD Group, said the broader availability of oatmeal at restaurants threatens to eat away at homemade oatmeal.
“Any time there’s work involved, we’re looking for how to get out of it,” he said, citing coffee as an example. Many people think differently about buying coffee today, Balzer said, “because Starbucks made it fast food.”
Now the same thing could happen with oatmeal, he predicted.
“It’ll be the fastest-growing food in the restaurant industry,” Balzer said. “Any time a major chain does anything, [the new product] becomes one of the fastest-growing foods, just because it’ll be available and people will try this.”